Posts

Canada Revenue Agency

CRA’s prescribed rate set to double on July 1, 2022

A key Canada Revenue Agency tax rate that impacts everything from the interest due on outstanding taxes to interest received on tax refunds, is about to double. The prescribed rate will increase to 2 per cent from the current 1 per cent, effective July 1st, 2022. The rate has remained at 1 per cent since […]

RRSP savings

April tax news: RRSP vs. TFSA benefits, gains and losses on personal property–and more

RRSP VS. TFSA – WHICH IS BETTER? This is a question that comes up regularly in financial planning and tax planning circles. But before we attempt to answer the question, we need to know the difference in the tax treatment between these plans. Although some commentators call the first 60 days of the year the […]

Reversionary or revocable trusts for a loved one

February tax news: Understanding trusts, managing partnership returns–and more

REVERSIONARY/REVOCABLE TRUSTS A trust is a relationship under which a person, called a settlor, contributes cash or other property in trust for the benefit of others, called the beneficiaries. The trust is not a legal person or entity for most purposes, but it is considered a “person” and a “taxpayer” for income tax purposes. The […]

death tax

October tax news: Death, taxes and capital gains treatment for Canadian securities

DEATH AND TAXES You’ve heard the saying about this − there are two sure things in life. On top of that, when you die, there may be additional income tax payable owing to the “deemed disposition” rules and other rules that apply specifically upon death. Before we get to those issues, in the year of […]

corporate shares

August tax news: ALDAs, tax-free transfers and TFSA penalties

TAX PLANNING AND ADVANCED LIFE-DEFERRED ANNUITIES (ALDAs) If you own a registered retirement savings plan (RRSP), you must wind it up by the end of the year in which you turn 71. At that point, you have the following options. First, you can take out all the funds in one lump sum. However, since the […]

intergenerational business transfer

Bill C-208 improves tax treatment on intergenerational business transfers, but changes to come

Until recently, it was more financially beneficial to sell a business to a third party in Canada, rather than passing it along to children or grandchildren through an intergenerational business transfer. This had been a longstanding bone of contention among entrepreneurs. Bill C-208, An Act to amend the Income Tax Act (transfer of small business […]

July tax news: Non-arm’s length property transfers, superficial losses–and more

NON-ARM’S LENGTH PROPERTY TRANSFERS Overview There are special rules under the Income Tax Act (the “Act”) that apply to property transfers to a non-arm’s length person. The rules, discussed below, can override the actual proceeds or sales price received on the property transfers. For most purposes, “related” persons, as defined in the Act, are non-arm’s […]

May tax news: Estate strategies, tuition tax credits–and more

ESTATES AND THE “PIPELINE” STRATEGY When a person dies, they are deemed to dispose of most of their capital properties at fair market value. This deemed disposition may trigger capital gains or losses, depending on the tax cost of the properties relative to their current fair market value. The person who acquires the property as […]

What’s the difference between tax avoidance and tax evasion?

In recent weeks we saw the publication of a landmark investigation into U.S. President Donald Trump’s business dealings surrounding the sweeping real estate empire built by family patriarch Fred Trump, all the way up to the present-day management of the business under Trump scions Donald Jr. and Eric. Indeed, the venerable New York Times declared […]